I founded Source Accounts Ltd in 2015 and sold it four years later. After selling it, I took a year out to do some studies to round out my knowledge. Then I set up another practice called Inaequo which provided virtual CFO services primarily aimed at tech companies. I sold Inaequo at the end of 2022 and since then I’ve been working for the buyer which is a big group of companies, and now I am transitioning from their Group CFO into a Group COO role.

My primary motivation for selling my first practice was IR35 legislation – IR35 had not yet been confirmed by the Government and I had quite a high concentration of contractors. If I’d sold the practice before any announcement about IR35 potentially coming in, I would have gotten a higher value for my practice, but at that point I had a decision to make – either I sell the practice now and get whatever value I could get for it, or I could wait to see if the Government would actually put through the new IR35 legislation. 

If I didn’t sell and the legislation came in, then my client base would have taken a decent hit – and if I had then wanted to sell then I would have got less value. It was just a gamble option on whether to cash out then or see what happens. I decided the sensible option for me at that point was to take the cash out and sell it. 

The buyer was still taking the risk that clients could be lost if the legislation came in but I didn’t want a clawback clause in the sale agreement. So I structured the deal differently – instead of a certain amount up front and then clawback over a couple of years, I said no to any clawback clause and took a reduced amount with all the money paid up front straight away.

I wrote a 1000-word email to clients and structured it from first principles – who, what, why, where, when, with answers to key questions like “will anything change” and gave as much detail as possible whilst still trying to keep it fairly succinct. All the key points were covered so there were very few queries that came back. 

Communication had always been my number one thing whilst running the practice – there had always been a high level of communication with my clients so they trusted me and weren’t unsettled when I told them I was selling. I introduced them to the buyer and it was very smooth. I hadn’t needed to prepare the practice for sale as everything was already on the cloud and running well.

I didn’t need to use a broker to sell my practice – the buyer was someone in my network and was actually the person who trained me as an accountant, so I knew it would be a good fit for my clients. It was a very easy transaction – it was probably the smoothest sale in the history of smooth sales.

With my second practice Inaequo, the reason I sold that was because I basically got a damn good offer! It was an acqui-hire – they were buying the company primarily for me and my skills and of course the clients came across too. Since joining the group, it has become apparent to all that my strength and interest is in operations and strategy - I actually enjoy that side more than the finance side - so I’ve just recruited my replacement and will move to be the Group COO soon.

My tips for anybody selling their practice:

• Make it as easy as possible for the buyer to make a decision by providing them with as much information as possible once non-disclosure agreements (NDAs) have been signed. Have as much digitised on the cloud as possible to make the buyer’s journey easier
• Make sure there is good communication with both clients and the buyer
• Have a good data room – a digital folder with all the due diligence information – year by year information on operations, financials, legal, P&L breakdowns, marketing breakdowns, etc. When you have a good data room then you can share the link with the buyer once NDAs have been signed and the buyer can see everything they need to see to make the sale process easier
• Set a deadline on the sale itself – things can be strung along on either side so set a strict deadline for signing NDAs and sharing the data room and set an expiry date for a response that will be a non-negotiable expiry date unless something catastrophic has happened like Covid for example.